Remortgage now or wait??

Hobo1234

I'm not sure anyone will be able to give me the advice I'm after but basically my fixed rate ends next August and we had been considering when it ends adding 20,000 onto it for some home improvements. We have around £61,000 outstanding. We're now debating remortgaging early and taking the small hit on the ERC (think 1%) based on the fact that rates are likely to continue to rise. Any advice on the expectation of rates in the next year?? 

Thanks for your help 

housebuyer143

Hobo1234 said:

I'm not sure anyone will be able to give me the advice I'm after but basically my fixed rate ends next August and we had been considering when it ends adding 20,000 onto it for some home improvements. We have around £61,000 outstanding. We're now debating remortgaging early and taking the small hit on the ERC (think 1%) based on the fact that rates are likely to continue to rise. Any advice on the expectation of rates in the next year?? 

Thanks for your help 

No one at all can tell you this. If they do they are just guessing which is exactly what you can do.
In your shoes I would just wait until next year and see the lay of the land and make a decision then. 

K_S

Hobo1234 said:

I'm not sure anyone will be able to give me the advice I'm after but basically my fixed rate ends next August and we had been considering when it ends adding 20,000 onto it for some home improvements. We have around £61,000 outstanding. We're now debating remortgaging early and taking the small hit on the ERC (think 1%) based on the fact that rates are likely to continue to rise. Any advice on the expectation of rates in the next year?? 

Thanks for your help 

@hobo1234 No comments on the trajectory of interest rates. Like everyone else, I may have a personal opinion but it's as valid as the next person's and hugely dependent on uncertain environmental factors.

With respect to your question, if a further rise in interest rates will be hugely problematic for your finances and fixing for a suitable length of time will help you sleep better, then it may be worth considering paying the 1% ERC (£600 or so) to do a capital-raise remortgage and fixing for (say) 5+ years.

If the above is not applicable, then to reduce your exposure to higher rates next year, it may be worth considering doing a further-advance/additional-borrowing with your current lender now for the 20k so that that part of the mortgage is fixed and you only need to worry about the 61k when your fix ends next year. Depending on which lender you are with, you may be able to select a new product as early as 1 March (6 months before the end of the fix) so only about 5-6 months away from today.

FashionHeart

Hobo1234 said:

I'm not sure anyone will be able to give me the advice I'm after but basically my fixed rate ends next August and we had been considering when it ends adding 20,000 onto it for some home improvements. We have around £61,000 outstanding. We're now debating remortgaging early and taking the small hit on the ERC (think 1%) based on the fact that rates are likely to continue to rise. Any advice on the expectation of rates in the next year?? 

Thanks for your help 

I'm in the same boat as you as my mortgage ends next August too.
No one at this time can give you advice, as you'll appreciate, things are very much unpredictable in a financial sense.
If you are really worried though, then do remortgage so that you can get the best rate out there.

fastenough

What you can do, and is what I do, is use a mortgage comparison/calculator to run a few scenarios of different interest rates with a view of low/medium/high as to what the future rates may be at the point of remortgage.

This will give you some projected figures to provide a sense of the financials for the different scenarios thus helping make an informed decision as well as being prepared for if/when things change.